NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE
INTERPRETATION SERVICE-BENEFIT CLAIMS
HEARINGS AND APPEALS
Referee Hearing, right to
Appeal Board hearing, right to
MISREPRESENTATION AND DETERMINATION
Recoverability of Overpayment
Right to Hearing (Referee and Appeal Board)
Where a claimant is not contesting the validity of an initial determination, the administrative law
judge and the Appeal Board do not have jurisdiction to rule on the Commissioner’s efforts to
collect an overpayment resulting from the determination.
Although a claimant may be relieved of his obligation to make additional criminal restitution payments, this does not prevent the Department from exercising its right to seek civil compensation for the amount still due on the overpayment.
Matter of Fierro, 80 AD 3d 944
Decided January 13, 2011
The Commissioner of Labor determined that claimant received a recoverable overpayment of unemployment insurance benefits in the amount of $13,804 (see Labor Law 597 ). The facts underlying the overpayment resulted in a criminal charge, and claimant pleaded guilty to grand larceny in the fourth degree. He was sentenced to probation and Ordered to pay monthly restitution of $426. In April 2008, while still owing $7,890 in restitution, claimant made a motion in New York City Criminal Court to reduce the amount of his monthly restitution payments. The court stated to him that if he served 90 days in jail, "then his obligations to the state [would] be extinguished." Claimant pleaded guilty and served the jail sentence. After his release, claimant received a letter from the Department of Labor informing him that it was resuming collection on his outstanding overpayment. Upon claimant's request, the Unemployment Insurance Appeal Board reopened the case and, after hearings were held, ultimately ruled against claimant. The Board initially stated in its decision that it did not have jurisdiction since claimant was not contesting the validity of an initial determination, but the Board nevertheless went on to address the merits and held that claimant's civil liability for the overpayment had not been extinguished by the criminal matter. Claimant appeals.
We affirm. Although claimant was relieved of his obligation to make any additional criminal restitution payments, this did not foreclose the Department from exercising its right to seek civil compensation for the amount still due on the overpayment (see Penal Law 60.27 ; City of New York v College Point Sports Assn., Inc., 61 AD3d 33, 44-47 ; State of New York v Stokols, 234 AD2d 222, 222-223 ; Kuriansky v Professional Care, 158 AD2d 897, 900 ).
Ordered that the decision is affirmed, without costs.
Appeal Board No. 545709
The Department of Labor issued the initial determination charging the claimant with an overpayment of $13,804.00 in benefits recoverable pursuant to Labor Law 597 (4). The claimant requested a hearing. The Commissioner of Labor objected that the hearing request was not made within the time allowed by statute. The Administrative Law Judge held hearings at which all parties were accorded a full opportunity to be heard and at which testimony was taken. There were appearances by the claimant and on behalf of the Commissioner of Labor. By decision filed March 11, 2009 (A.L.J. Case No. 008-22247), the Administrative Law Judge continued in effect the initial determination. The claimant applied to the Appeal Board, pursuant to Labor Law 620 (3), for are opening and reconsideration of the Judge's decision. Due deliberation having been had, the Board has reopened and reconsidered the decision of the Administrative Law Judge. Based on the record and testimony in this case, the Board makes the following
FINDINGS OF FACT: On October 31, 2003, the Department of Labor issued an initial determination charging the claimant with a recoverable overpayment in the total amount of $13,804.00 (based on other determinations holding the claimant to be not totally unemployed and finding that he had made wilful misrepresentations made to obtain benefits). In April 2004, the claimant was arrested on a charge of grand larceny in the third degree arising from the overpayment due to the Department of Labor; he ultimately pled guilty to grand larceny in the fourth degree. He was sentenced to probation, a term of which included restitution in the amount of $13,804.00. The restitution order provided that the claimant was to pay $426.00 per month; the payments were to be made to the Department of Probation, and included both the restitution amount, as well as a five percent surcharge imposed by the Department of Probation pursuant to Penal Law 60.27 (8).In 2005, the claimant filed another claim for benefits; he was found eligible, but his benefits were used to offset the overpayment. The claimant did not ask for a hearing at any time because he did not dispute the accuracy of the determinations, conceding that he owed the Department of Labor the overpayment. In April 2008, the claimant brought a motion in the Criminal Court of the City of New York to reduce his monthly restitution payments from $426.00 per month to $270.00 per month. The matter came before the court on July 1, 2008; the Judge, noting the age of the case and the fact that the claimant still owed $7,890.00 (which was a result of his failure to make his restitution payments for a significant period of time and which included the five percent surcharge), recommended that the claimant should instead plead guilty to a charge of failure to make restitution, with the result that he would be re-sentenced to a period of incarceration of ninety days and would no longer be required to make his restitution payments. After discussion with his attorney, the claimant pled guilty and was sentenced. After his release from incarceration, in response to a letter he had received from the Department of Labor's Claims Service, seeking repayment of the monies still owed on the overpayment, the claimant wrote a letter on September 15, 2008, asking for a hearing on the overpayment. As of July 1, 2008, the claimant still owed the Department of Labor $7,389.76.
OPINION: Pursuant to Labor Law 620 and 621, the Appeal Board and the Administrative Law Judge have jurisdiction over disputed claims for benefits, where a claimant or any other party is dissatisfied with an initial determination issued by the Department of Labor. The claimant has conceded that he does not dispute the determination of recoverable overpayment (or the two other initial determinations issued in 2003). Rather, the claimant is seeking to stop the Department of Labor's efforts to recover the remaining overpayment, arguing that his plea and consequent incarceration on July 1, 2008 have cancelled the debt. As the claimant is not contesting the validity of an initial determination, the Board has no jurisdiction and there is no issue to be decided, either on the merits of the determination or on the timeliness objection interposed by the Department of Labor (Appeal Board Nos. 449890 and 428930).Nonetheless, we note that the claimant's argument is without merit. Penal Law 60.27(6) provides: "Any payment made as restitution or reparation pursuant to this section shall not limit, preclude or impair any liability for damages in any civil action or proceeding for an amount in excess of such payment." Although the Criminal Court judge ruled that the claimant no longer had to continue making his restitution payments, there is still money owed by the claimant on the original overpayment. The Department of Labor -which was not a party to the criminal action - is still authorized to seek repayment of the remaining overpayment (see, People v Stokols, 234 AD2d 222 ([1st Dept 1996]; People v Wein, 294 AD2d 78 (1st Dept 2002).DECISION: The decision of the Administrative Law Judge is affirmed. The initial determination, charging the claimant with an overpayment of $13,804.00 in benefits recoverable pursuant to Labor Law 597 (4), is continued in effect.